July 20 (Bloomberg) -- Amazon.com Inc., escalating its
competition with Netflix Inc. and Hulu LLC, reached an agreement
allowing customers to watch thousands of the CBS television
shows online.

The non-exclusive agreement with CBS Corp. adds 2,000
episodes of shows, including full seasons of “Numb3rs” and
“Medium” at no additional cost to subscribers of the Amazon
Prime service, the world’s largest online retailer said today in
a statement. Other terms of the deal weren’t disclosed.

Amazon Prime is a membership program that gives subscribers
discounts on shipping for an annual fee of $79. In a push to
challenge Netflix and Hulu, Amazon said in February it would
offer Prime customers unlimited access to an online library. The
CBS deal expands that library to more than 8,000 movies and TV
shows. Netflix offers more than 20,000 movies and TV shows
online, according to Steve Swasey, a spokesman.

Hulu, a Los Angeles-based Web service that streams TV
shows, is soliciting takeover bids. The company, owned by Walt
Disney Co., News Corp. and Comcast Corp.’s NBC Universal, is
offering suitors five years of access to shows, including two
years of exclusivity, two people with knowledge of the situation
said July 19.

“This agreement could diminish the likelihood of Amazon
being a buyer of Hulu since it’s going down its own path and
doing separate deals with content vendors,” said James
Cordwell, an equity analyst at Atlantic Equities in London who
recommends Amazon shares. Amazon spokeswoman Mary Osako didn’t
return a call seeking comment.

Amazon, based in Seattle, fell $2.51 to $215.55 at 4 p.m.
New York time in Nasdaq Stock Market trading. The shares have
gained 20 percent this year. CBS climbed 78 cents to $28.74 on
the New York Stock Exchange and has increased 51 percent this
year.

Netflix, based in Los Gatos, California, declined $5.89 to
$281.40 on the Nasdaq and has risen 60 percent this year. CBS
and Netflix announced a two-year, non-exclusive licensing
agreement for streaming content in February.